Have credit rating agencies become more stringent towards Japanese regional banks?

Kondo, Kazumine (2011): Have credit rating agencies become more stringent towards Japanese regional banks?

Abstract

This article investigates empirically whether foreign and domestic credit rating agencies tightened their standards for evaluating Japanese regional banks from 2000 to 2009. We extend and enhance previous studies, including Gonis and Taylor (2009), by estimating an ordered probit model using pooled data for this period. Our results reveal that foreign agencies did not rate Japanese regional banks more stringently during this period, perhaps because they wished not to repel clients and reduce their revenues. Japan’s rating agencies showed the opposite tendency, perhaps to seek credibility among foreign investors.

• Item Type: MPRA Paper
• Language: English
• Keywords: credit ratings; rating stringencies; regional banks; foreign credit rating agencies; domestic credit rating agencies
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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